BHP Revises Start-Up of California Gas Terminal to 2012-13

BHP Billiton Ltd., Australia's biggest oil and gas producer, said the start-up of a proposed $800 million natural gas import terminal in California may be delayed to 2013 as project approvals take longer than expected.

The company is ``very pleased'' to be in the final stage of the regulatory approvals process after the release March 9 of the final environmental report, said Kathi Hann, a spokeswoman in California. That document will be the basis for each of the relevant regulatory agencies to issue permits, she said.

BHP announced plans in August 2003 for Cabrillo Port, which would import about 800 million cubic feet a day of gas to meet about 12 percent of California's requirements for the fuel. It originally expected primary approvals by the end of 2004 and to start up the terminal in 2008. Final approvals are now expected over the next months, allowing details design work to start.

``We anticipate that whole process with construction to take a good five years at the minimum,'' Hann said in a telephone interview. ``We're expecting to deliver first gas here in California by, I guess, that would be 2012, 2013.''

The Cabrillo Port liquefied natural gas terminal, which would be located about 14 miles off the coast of Ventura County, comprises an offshore floating storage and a processing unit to turn the LNG back in to gaseous form, plus pipelines on the ocean floor to pump gas into the state southern grid system.

BHP has modified aspects of the project from the original plan to reduce harmful environmental effects. It has reduced the expected number of LNG tanker arrivals to a maximum of 99, from 130, modified the proposed water cooling design to use a closed system, and agreed to use cleaner burning natural gas for tankers in California coastal waters.

Hollywood Stars

Still, Cabrillo faces opposition from celebrities such as former James Bond film stars Pierce Brosnan and Halle Berry, who are among Hollywood stars campaigning against the project citing concerns about safety and the potential for terrorist attacks.

Still, ``a number of adverse effects would remain significant and unavoidable,'' the U.S. Coast Guard, the Maritime Administration and the California State Lands Commission said in the final environmental report.

The agencies signal potential effects on public safety from damage to pipelines or a spill of LNG, and effects on air and water quality during construction.

The agencies are due to hold final public hearings next month, and California Governor Arnold Schwarzenegger is due to ``weigh in on the deepwater port license'' in May, Hann said. The State Lands Commission has also yet to rule on a state permit, and Hann said she didn't know when that decision was due.

source:www.bloomberg.com